Brunswick or Broadmeadows?

[Belu]

So I am now in a position (finally) to buy (with the help of FHOG).

Plan is to buy soon and rent for first 6 months and then move in after for 6 months before moving out and renting elsewhere.

I have a tight budget for Melb ($250k), so am looking at either:

2 BR unit in Brunswick
3 BR House in Broadmeadows.

Looking for advice, my thoughts are:

- More value-adding able to be done to house in Broady, including subdividing
- I feel Broadmeadows is undervalued due to its stigma
- Brunswick is much closer to the city and in a "hip" pocket of town
- ROI on both should be similar.
- My stratergy is to buy and hold. Increase in equity in next 2 years would be good to help leverage into other properties.
- Tennents in Broady may be harder to control than in Brunswick

Would appreciate any feedback and comments. I don't mind living in Broady or Brunswick for 6 months either.

Cheers,

Ben

 

[buzzlightyear]

I personally wouldn't invest in Broadmeadows, but I am biased because I used to work out there for approximately 4 years and was not a fan of the area. Admittedly this is a subjective opinion and not based on understanding prices, trends.

However I would make the following comments, Brunswick is serviced by both train, trams & buses, you will always have tenants given its proximity to the city with the ability to utilise all forms of public transort. With Broady, yes there is the train and there are bus services but they aren't as frequent as they are in and around Brunswick. Given this is a long-term hold, access to all modes of public transport will become increasingly valuable given petrol prices and talk about congestion levies for CBD, tighter restricted parking in and around the city..

I visited Broady just recently, picking up some tesselated tiles for a reno and passed through the same way I used to go to work and not much has changed to be honest.

These are the suburb profiles from domain.com.au for Brunswick and for Broadmeadows

If you had to live there for 6 months for the FHOG, I am confident in saying you would get far better enjoyment in living in Bunswick. Good luck with it, either way you go.

 

[Belu]

Thanks for the links for the profiles, some good information. I went to the HUME (for Broadmeadows) council website and couldnt find any information on how big the allotments need to be for subdivision - can anyone point me in the right direction please?

I guess I am looking at it thinking "In 10 years time will a 2BR in Brunswick or 600sqm of dirt (with a house or two on it) be worth more?"

What do people think?

 

[Lake]

Thanks for the links for the profiles, some good information. I went to the HUME (for Broadmeadows) council website and couldnt find any information on how big the allotments need to be for subdivision - can anyone point me in the right direction please?

I guess I am looking at it thinking "In 10 years time will a 2BR in Brunswick or 600sqm of dirt (with a house or two on it) be worth more?"

What do people think?

For investment I think Broady with a train station, even with its stigma, you can't go wrong.

As you said, there is alot more room to add value (sub-divide, reno, etc), than if you had a 2-bed apartment in Brunswick.

You'll possibly have more tenant issues, but I think it'll be offset by the land-value appreciation you'll get.

 

[chran]

Iif you're going to live there don't forget to check the surrounding areas during the day AND night. Have you also consider going from/ to work etc?

Personally I'd pick Broady if it's long-term (8+ years). I believe Broady has more appreciation potential with its stigma (ie. no one wants it now but population growth & housing demand will sort it out in the future).

 

[THEHEATH]

I'm just a schmuck so take my opinion with a grain of salt, but I'd be going for a nice big block in Broady that you can subdivide later. I remember reading on here that Hume Council are quite pro development too :thumb:

 

[Soren Lorenson]

For investment I think Broady with a train station, even with its stigma, you can't go wrong.

As you said, there is alot more room to add value (sub-divide, reno, etc), than if you had a 2-bed apartment in Brunswick.

You'll possibly have more tenant issues, but I think it'll be offset by the land-value appreciation you'll get.

Would agree wholeheartedly with this; buy the land, you will have a lower yield but would probably win over the 2 bed flat/unit in the long term, make sure you can hold even in a recession / downturn, dont bank on having good growth and equity in 2 years. Try and buy on a good street with proximity to train, wait for the gentrification

 

[Belu]

Yeah, im only 22 so can wait for the gentrification - as long as I can hold them

 

[DavidMc]

I guess I am looking at it thinking "In 10 years time will a 2BR in Brunswick or 600sqm of dirt (with a house or two on it) be worth more?"

What do people think?

I think it's more a question of 'do I want to live in Broadmeadows for 6 months?'

 

[Belu]

Why? 6 months isnt long, this is my first place and I am only 22 so i dont think I should be too picky for my first one! haha

 

[fernfurn]

I know the area quite well, my daughter said we should buy there 2-3 years ago and I said, no way Broady will never move up in price. Was I wrong, they are pulling down old houses and building units faster than you can blink. A huge amount of moslems have moved in and most of them are wrapped at having a house and treat it very nicely doing up the garden etc. On the other hand, there is still a huge part of it with the old outlook. I think in time it will come up well, after all it is only 12ks from the city with 30min rail trip to town. And they said Footescray would never gentrify. I would buy in Broady over Brunswick as with a view to developing you will havemuch better cap gains.

 

[jingo]

Hi Belu,

It is never easy to decide where to invest. Emotions can easily get in the way. As far as suburbs go Brunswick is fantastic. It has the lifestyle attractions and proximity to the city that make it so desirable. These attractions are sought after by people now and will be in the future as well.

The reality though, is that many people cannot afford to buy into areas close to the city. Therefore looking further out (12kms is not far by the way) is probably a smart move.

If you can manufacture growth by buying a large block of land, or run down IP that you can renovate and capture some equity, so much the better.

I'd try to establish a buffer before buying. Allow for vacancies, rising interest rates, tenants who are slow with their rent, non payers etc. Would you be able to establish this buffer while you are living in the place before you rent it out? Living in the place would certainly give you the opportunity to renovate it (paint etc) at the same time!

Look forward to hearing what you decide to do.

P.S. The Melbourne market is interesting at the moment. Some inner areas have stalled, while some outer areas are rising. (Eg Werribee, Laverton, Point Cook and surrounding areas).

Regards Jason.

 

[murtagh]

P.S. The Melbourne market is interesting at the moment. Some inner areas have stalled, while some outer areas are rising. (Eg Werribee, Laverton, Point Cook and surrounding areas).

Certainly is interesting times .. in my local area (just around the corner from Brunswick) I attend a few auctions a week, and I'm seeing new or refurb'd units getting snapped up. Maybe not as fast as six months ago, but they are still moving along nicely. Older and more run down stock is just lingering on and on though.

Probably a really good sign for Belu! Get out there and make some cheeky offers!

 

[investwest]

I agree, and it's fun watching the area change.

Why? 6 months isnt long, this is my first place and I am only 22 so i dont think I should be too picky for my first one! haha

We moved to Altona Meadows from Yarraville six years ago, a bit of a shock at first, but then each year it just got better and better, like Yarraville did. I love watching the area change, it's exciting. Getting in on the ground level is a lot more fun too. Go for Broadmeadows! and congratulations on buying your first place at 22, in ten years time when everyone else your age is finally ready to buy, you are going to be laughing.

 

[DavidMc]

Why? 6 months isnt long, this is my first place and I am only 22 so i dont think I should be too picky for my first one! haha

It's really hard to say which will have better capital growth.

If I were to bet, maybe Broadmeadows, as it has development potential down the track. I reckon 2008 is the year of the 'ripple effect' as well.

Having said that, if it's a 50/50 decision and either property will bring you closer to your goals, my recent strategy is to choose the one I prefer to live in. Not just today, over the next 30-40-50 years time.

If I prefer to live in it, so will others, and I've found my properties that appeal to OO's have been getting better growth than those that don't, even in the same suburb (different estates). These ones have worse yield though, so I like to have a mix of high/medium/low yielding, inner/outer, new/old, house/apartment.

In this 'rental crisis' being able to be to live in a property you own and enjoy for a long period is pretty handy. After 6 months when you move out of Broady where are you going to live now that you have enjoyed the freedom of living out of home? Probably will be easier to get a flatmate in Brunny as well.

My 2c.

 

[Player]

I'm just a schmuck so take my opinion with a grain of salt, but I'd be going for a nice big block in Broady that you can subdivide later. I remember reading on here that Hume Council are quite pro development too :thumb:

Have to agree. They aren't making any more land there and, YES, the City of Hume is pro-development.

Belu,

I and others have posted views on Broadmeadows elsewhere, have a look here also:

http://www.somersoft.com/forums/showthread.php?t=41134

http://www.somersoft.com/forums/showthread.php?t=41124

 

[bennido]

I am with most of the comments so far ... for investment = Broadmeadows ... for living = Brunswick ..